Shaping the Tertiary Education System - Speech

Speech at Shaping Our Future, the 2001 annual conference
of the Association of Staff in Tertiary Education. Brentwood
Hotel, Wellington.

I am pleased to be here today to speak
at your conference. As a professional association covering
approximately 4000 staff in both the private and public
sectors, you are a vital part of the tertiary education
system.

You are gathering this week at a time when work
on where we are going in the tertiary education system is
beginning to take shape. This work will take us out of the
situation we’ve been left in as a result of the last ten
years

We need to change, firstly, to correct the
imbalances of the competitive era. Secondly, we need to
enable the tertiary education system to make a strong
contribution to New Zealand’s social and economic needs, and
propel us forward in our development as a knowledge society.

THE CURRENT SITUATION AND THE CHALLENGE

The intent of
Labour’s Learning for Life reforms of 1989-1990 was to
create a balance. Institutions got the autonomy they had
been seeking, and that autonomy was to be constrained by
carefully drawn up Charters setting out complementary
institutional missions.

In implementing those reforms,
however, instead of the proposed co-operative model, the
National government developed a market-place model requiring
institutions to focus - to an unhealthy degree - on
competitive activities.

This has placed some institutions
at risk and resulted in a fragmented system lacking in clear
direction and leadership. Of course, such an environment
impacts on all concerned, students as well as staff. You
will be able to vouch for the financial pressure
institutions were put under, and the time and energy that
was diverted away from the core task of providing quality
tertiary education.

I know that some of your members will
also have faced redundancies, and others the resulting
challenges of larger classes and more responsibilities. Of
course, this all has an impact on the quality of the
education provided.

Our challenge as a government is to
provide future-focussed leadership to the tertiary education
system. New Zealand now faces new and demanding challenges
in a period of rapid global change - in technology, in
communications, and in labour market dynamics. These changes
will continue to have a profound effect on the sector you
represent.

The tertiary sector has an important role to
play in equipping New Zealand to meet these challenges and
to take advantage of the opportunities they create. The
tertiary education sector also has a fundamental role to
play in promoting a vibrant cultural identity, which places
value on diversity, achievement and innovation.

Tertiary
education will be key to “Shaping our Future” (the theme of
this conference) as a knowledge society.

PROGRESS SO FAR

A key requirement for this is that it be properly
resourced to carry out its functions. We have already made a
start on this.

We have been active in working with
institutions that have been, to varying extents, casualties
of the competitive model. We have provided advice and
governance training. We have provided Crown Observers where
necessary.

We have also provided a considerable amount of
money. A recent estimate was that between capital
injections, loans and loan forgiveness, we have contributed
about $50 million in capital expenditure to assisting “at
risk’ institutions.

This has not been money “down the
drain’. It has focussed on moving these institutions towards
sustainable solutions. This has sometimes involved tough
decisions. But our focus has always been on preserving an
adequate range of high-quality tertiary education programmes
in each region.

Labour and the Alliance have also halted
the “death of a thousand funding cuts’ that National imposed
on tertiary education over the 1990s. We have continued to
fund growth without reducing the funding rates. We have also
extended the number of places funded through Youth Training
and in particular Industry Training (where we have committed
an extra $24 million a year). And we are developing new
tertiary education pathways such as Modern Apprenticeships,
Gateway and learning and assessment centres.

We have
committed an additional $100 million in 2001 and 2002 to
raise the EFTS funding rates. This has been part of the “fee
stabilisation’ offer and so it has been portrayed that this
money has all gone to the benefit of students. In fact only
$32 million (just under a third) was for the purpose of
compensating providers for the effects of inflation on
tuition fees.

The remaining $68 million adjusted the
rates for 3.4% inflation on government tuition subsidies
over 2001 and 2002. This is the first time since the initial
development of the EFTS tuition subsidies that they have
been adjusted for inflation.

This distinction might not
be too important to an institution with a strong “market
position’. They would have been able raise fees by enough to
pass on a failure by Government to adjust for inflation. But
for many regional institutions struggling to retain
enrolments, this $68 million inflation adjustment has been
absolutely vital.

We have made a start. Nobody is under
any illusions that if we are to retain a strong network of
public tertiary education institutions, more is needed.

A
PARADIGM SHIFT

But new money also needs to be spent
strategically.Tertiary education is one of this country’s
major public investments in building the skills and
capability needed for the future. To maximise the benefits
of this important investment, a paradigm shift is required.

The tertiary education system will no longer be solely
driven by the choices of consumers as it was during the
1990s, when it was too narrowly focussed on student demand
as the primary determinant of resource allocation. Rather,
the focus of the tertiary education system will now be to
produce the skills, knowledge and innovation that New
Zealand needs to:

- transform our economy;

- promote
social and cultural development; and

- meet the rapidly
changing requirements of national and international labour
markets.

This Labour/Alliance Government is leading a
shift to a co-operative and collaborative sector, unified by
a clear vision for the future, which contributes effectively
to New Zealand’s development as a knowledge nation. While
maintaining strong levels of participation, the tertiary
education system needs to be more explicitly aligned with
wider government goals for economic and social development.

The key message is that the tertiary education system can
no longer be seen in isolation from the Government’s wider
social and economic development initiatives and strategies.

THE TERTIARY EDUCATION ADVISORY COMMISSION

As you may
know, the Tertiary Education Advisory Commission (TEAC) was
established by the Labour/Alliance Government in April 2000.
It was tasked to provide advice on the future strategic
direction of the New Zealand tertiary education system.

The Commission’s first report, Shaping a Shared Vision,
set out a broad vision that has guided its work ever since.
TEAC’s second report, Shaping the System, gave us the
steering mechanisms we will need in order to use our
tertiary education capability strategically. These are:

-
Charters for publicly-funded providers that are meaningful
and set out their special mission and contribution to the
system as a whole;

- Provider profiles to avoid
duplication and focus each provider on their specialities
and the needs of their stakeholders;

- A Centres of
Research Excellence Fund to foster excellence in areas of
strategic importance; and

- A Tertiary Education
Commission (TEC) to bring the administration of the whole
system together under one agency, with strong involvement
from business and other stakeholders in its governance.

Over the next few months, further decisions regarding the
structure of the TEC, the nature and form of Charters and
Profiles, and the funding system will be taken. I would like
to discuss briefly each of these topics in the context of
the Tertiary Education Strategy that is currently being
developed.

THE TERTIARY EDUCATION STRATEGY

The
Tertiary Education Strategy will cover the whole tertiary
education system, and will have linkages with the compulsory
education system and the labour market. All elements of the
system need to be performing to the highest standards to
ensure we develop the skills, capabilities and knowledge
that New Zealand requires for the future. To develop an
inclusive knowledge society in this country we need a
tertiary education system that provides diversity with
excellence.

The Tertiary Education Strategy will outline
how the tertiary education system will achieve the paradigm
shift from looking inwards at consumers, to looking outwards
at how it can:

- contribute to New Zealand’s goals for
economic and social development;

- produce the knowledge
that New Zealand needs to be a world leader in innovation;

- produce the skills and competencies that New Zealanders
need in order to fuel our economic growth; and

- develop
the capabilities within the sector to meet the needs and
expectations of enterprise and communities.

The Strategy
will outline priorities and milestones for the next three to
five years and inform policy direction, purchasing decisions
and capability building by the TEC, as well as provide a
framework within which the tertiary education system can
develop.

The development of any tertiary education
strategy is not a task that should be undertaken behind
closed doors. We want to hear your views and suggestions
about the content of the Tertiary Education Strategy, and
have established a website for this purpose:
www.talktertiarystrategy.minedu.govt.nz. Submissions and
comments on both the Strategy and TEAC’s Shaping the
Strategy report are welcomed until 31 October 2001.

This
forum for discussion is being complemented by a series of
workshops around New Zealand over the next couple of months
to seek further engagement from you, communities, industries
and others in the tertiary sector. We expect to publicly
release a draft Tertiary Education Strategy in December 2001
for feedback.

TERTIARY EDUCATION COMMISSION (TEC)

The
TEC will positively impact on you, as tertiary staff, by
providing a more strategic and systematic approach to the
way that tertiary education is funded and regulated. The TEC
will include the functions currently carried out by Skill
New Zealand and the Tertiary Resourcing division of the
Ministry of Education. Just to put these units’ functions
into perspective, the Tertiary Resourcing Division of the
Ministry is responsible for the administration of $1.5
billion of tertiary funding to tertiary education providers!
The TEC will also have responsibility for implementing the
Tertiary Education Strategy.

Progress has been made in
this area with the creation of Transition TEC, which will
act as an “establishment board’ for the TEC during its
set-up phase. I am pleased that Dr Andrew West, Chief
Executive of the New Zealand Qualifications Authority, has
been appointed as Chair of Transition TEC, and Kaye Turner,
currently Deputy Vice-Chancellor (Academic) at the
University of Waikato, has been appointed as Deputy Chair.
Transition TEC will also act as an “advisory board’ during
both the further development of the Tertiary Education
Strategy and the work on Charters and Profiles.

CHARTERS
AND PROFILES, & THE STRATEGIC CHANGE FUND

We have set up
a working party to make recommendations on the operational
details of a new system of charters and profiles that would
set out strategic directions and activities for all
government funded tertiary education providers and Industry
Training Organisations.

As you will be aware, at present
only public tertiary education institutions are required to
have charters. This new policy would see this requirement
extended to government funded private providers as well. The
idea is that Profiles will replace the annual statement of
objectives, which providers currently prepare.

The
working party of sector representatives is making good
progress working through the details of this proposal. This
process gives us the opportunity to hear and respond to
staff concerns.

For instance, one of the matters that
Charters will need to cover is the approach to ensuring that
the organisation develops and supports a staff profile that
reflects its mission and special character. The working
party is still working through the text which explains what
this should mean, and ASTE are part of this process.

We
recognise that in order to achieve a more co-ordinated and
coherent tertiary sector, change will be required at many
levels. We are supporting you and your institutions to
effect this change by making available both capital and
operational funding through the Strategic Change Fund.

The Fund of $35 million will provide both capital
($16.615 million) and operational funding ($18.142 million)
to public tertiary institutions in 2002/03 to help them
adjust to the new environment of the tertiary sector. It
will largely fund activities aimed at improving sector
performance - strategic, business and risk management
planning and a host of other activities such as joint
ventures, infra-structural and human resource development
and governance and management.

The reason this Fund is
only available for public institutions reflects the distinct
differences between public and private providers in terms of
the Crown’s ownership interest in them. The ownership
relationship, between the Crown and public providers, means
that the Government has a long term strategic interest in
the continuing viability of these providers that differs
from its interest in having a viable private sector.

CONCLUSION

ASTE, as a professional body representing
staff throughout the tertiary sector, will play an important
part in the development of a tertiary system which will
drive this country’s social and economic development as a
knowledge society. It is critical that we work together to
achieve this. The Government is committed to effectively
resourcing the sector to enable positive change towards a
more co-operative, outwards looking sector.

Let me in
closing just mention one further symbol of this commitment.
We have provided funding for the establishment of annual
teaching awards for outstanding tertiary education teachers.
Apart from national recognition, the awards will provide
some financial support for the tertiary education teacher to
further his or her interests in teaching.

We don’t just
intend to identify individuals but also practices that can
be disseminated. The best examples of tertiary education
teaching will also be shared nationally through an annual
publication of best practice.

Thank you for the
opportunity to speak at your conference. I look forward to
continuing to work with you through the range of initiatives
that are underway, and encourage your continued input.

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